The streak is over, and the pain continues for those in the Lawrence home-building industry.
Since at least 1956 — as long as the city has been keeping records — builders have started at least 100 new single-family homes each year in Lawrence. But 2011 is the year that the popped housing bubble finally drenched a piece of pride for the Lawrence construction industry.
According to a new report from City Hall, the city issued 95 permits for single-family homes in 2011.
“I’ve been telling my suppliers and my employees that survival is success these days,” said Kelly Drake, owner of Lawrence’s Mallard Homes.
The city’s previous low for single-family home starts was 102 units in 2008. That was followed by 110 units in 2009. In other words, three of the worst periods on record have happened in the last four years.
In 2010, 146 new single-family units were started.
“We used to sell around 16 to 20 houses per year,” said Frank Salb, owner of Salb Construction. “(in 2011) we sold three.”
Mallard said he continues to build a few new homes on speculation, but he said it now takes eight to 14 months to sell a home. It once took less than four.
Drake said new homes are facing significant competition from foreclosed homes or homes that banks are selling as part of “short sales.” He said the price of construction materials and labor haven’t gone down enough to keep up with the type of discounts that are available with many of those types of sales.
He and Salb also said the lack of major new job announcements in Lawrence has shrunk the market of new homebuyers. Salb said the scenario of people living in Lawrence but commuting to Johnson County has become less common as gasoline prices have remained high for a long period of time.
“The commuting thing isn’t working like it did in the 1990s,” Salb said. “It is not working well at all right now. We’ve got to get some more jobs here.”
There were some signs of life in the building industry in 2011. Builders started 355 apartment units in the city, which is the most since 2008. The city also had some large-dollar commercial projects started in the last year.
The total value of all private projects under construction in 2011 was $107.7 million, up from $85 million in 2010 and $68 million in 2009.
Much of 2010’s totals came from large commercial projects, such as the Bowersock hydroelectric power plant in North Lawrence. Those projects, though, haven’t necessarily kept residential home builders busy. Instead, they’ve shifted to doing remodeling work and other odd jobs, projects they rarely had time for during past years.
From 1991 to 2004, the city issued at least 300 single-family building permits per year, with the high-water mark coming in 1994 with 486 housing starts.
Today, the number of housing starts have dropped below levels seen in the 1980s, when mortgage rates were routinely well-above 10 percent.
“I remember telling the Journal-World in an article in the 1980s that if we could just get interest rates below 10 percent, I really thought the housing market was going to take off,” Salb said. “It is hard to believe we can get mortgages for 4 percent, and we’re in this situation.”